Dominic Raab, the foreign secretary, has ruled out an exchange of seized oil tankers with Iran, saying there can no “quid pro quo” to end the standoff.
Iran has suggested that it would release the British-flagged Stena Impero if the UK agrees to release the Grace 1, a Iranian tanker seized in Gibraltar earlier this month.
But the UK maintains the Grace 1 was legally seized for violating EU oil sanctions on Syria, while the Iranian seizure of the Stena Impero was an illegal act of “state piracy”.
“There is no quid pro quo. Grace 1 was intercepted because it was in breach of sanctions and heading with oil to Syria,” Mr Raab said on the Today programme.
“The Stena Impero was unlawfully detained. So this isn’t about some kind of barter. This is about international law.
Hours later, the Iranian ambassador in London denied that the offer of an exchange was ever on the table, essentially turning the same argument back on Mr Raab.
“Impossible to advance a quid pro quo or barter exchange of detained UK and Iranian ships as some British media suggest,” said Hamid Baeidinejad.
“UK has illegally detained the ship carrying Iranian oil while the British ship is detained for violating some key safety/security regulations in Hormuz Strait.”
Iran has accused Britain of seizing its tanker at the behest of the Trump administration, which is trying to choke off all Iranian oil exports. The UK denies the allegation.
Mr Raab also urged Western allies not to engage in a “geopolitical EU versus US tussle” over plans for competing naval missions in the Persian Gulf to protect shipping.
While Jeremy Hunt, the former foreign secretary, proposed a European naval operation Mr Raab has said that any EU initiative will need American support to be viable.
France and Germany have insisted the initiative be independent of American naval operations in the Gulf, which they see as part of Donald Trump’s “maximum pressure” campaign against Iran.
“We want to see a European-led approach but in reality it shouldn’t be some kind of geopolitical EU versus US tussle,” Mr Raab said.
“I think it would be important for the European-led initiative to have US support to make it viable.”
Britain now has two warships in the Persian Gulf to escort British ships as they pass through the Strait of Hormuz.
The HMS Montrose, a frigate, has been in the region for several weeks while the HMS Duncan, a destroyer, arrived over the weekend.
“The security of British-flagged ships is our priority, and we continue to work to de-escalate the situation with Iran following the unacceptable and illegal seizure of the Stena Impero,” said Grant Shapps, the transport secretary.